KPS Speeds To $3.5B Finish For Fund IV

KPS Capital Partners needed less three months to raise its most recent fund, which collected $3.5 billion. KPS Special Situations Fund IV officially began marketing on Jan. 31 and closed April 12, a source told sister Web site peHUB. Fund IV had a $3 billion target and was the third oversubscribed institutional private equity fund raised by KPS, according to a statement. KPS did not use a placement agent.

PeHUB, which reported the fundraising in January, said at the time that KPS Fund IV was so hot that it was generating $9 billion worth of interest. KPS’s speedy fundraising is much different than other buyout firms, which typically spend roughly 18 months marketing. Dave Rubenstein, a co-founder and co-CEO of The Carlyle Group LP, said in February that the global buyout shop will likely spend about 16 to 17 months marketing for its latest U.S. buyout fund, which is much larger and has a $10 billion target.

But KPS isn’t the only firm to have a speedy fundraise. According to the alternative-asset data provider Preqin, which looked at U.S. firms raising more than $1 billion, one of the speediest GP’s recently was TSG Consumer Partners. The firm needed only two months in 2011 to collect $1.3 billion for its sixth fund. New Enterprise Associates also spent 2.7 months amassing $2.6 billion for its latest fund last year. And H.I.G. Capital, in March, closed its fifth buyout fund at $1 billion. H.I.G. was on the road for a little more than three months for Fund V, Preqin said.

Water Street Healthcare Partners also needed less than eight weeks to collect its third fund last year, which closed at $750 million. In 2011, Berkshire Partners spent about four months marketing for its most recent pool, which came in at $4.5 billion.

New York-based KPS, a special situations investor, raised $2 billion with its last pool in 2009. KPS Special Situations Fund III originally closed at $1.2 billion in 2007, but the firm ended up raising $800 million in additional capital that brought total commitments to $2 billion. The pool is generating a net IRR of 20.6 percent, according to Sept. 30 data from the California Public Employees’ Retirement System. The firm’s second fund collected $404 million in 2004. Performance data wasn’t available for Fund II.

Luisa Beltran is a senior writer for peHUB.